Clonal epithelial cell cultures derived from mouse pulmonary adenoma have been treated by hydrocortisone. Electron microscopic observation of at least one of the clones indicates that prolonged exposure to hydrocortisone has led to morphological differentiation of the cells. The hormone also appears to be growth-sitimulatory. We therefore propose the following: 1. To determine whether hydrocortisone-treated lung adenoma cells are functionally differentiated by the analysis of the incorporation of Cl4-palmitic acid into dipalmitoyl lecithin. 2. To compare the relative activities of both major pathways for surfactant synthesis in hydrocortisone-treated cultures by examining the incorporation of radiolabeled methionine and choline into disaturated lecithins. This should provide information as to the mechanism of hydrocortisone action; i.e., does it stimulate function of both synthetic pathways or only one? 3. To determine whether hydrocortisone-treated cultures are releasing pulmonary surfactant by examination of the incorporation of radiolabeled palmitic acid into disaturated lecithins in the culture medium at various incubation periods. 4. To examine cellular sites for synthesis and storage of surfactant by electron microscopy of functional adenoma cells after treatment with ferriti-labeled antibody to the protein components of mouse pulmonary surfactant.